Rocket Pharmaceuticals(RCKT) - 2025 Q2 - Quarterly Results

Report Overview Strategic and Financial Highlights Rocket Pharmaceuticals announced a strategic pivot to prioritize its AAV cardiovascular gene therapy platform, alongside a significant organizational restructuring aimed at reducing costs. The company reported a cash position of $271.5 million, providing an operational runway into the second quarter of 2027, and appointed Chris Stevens as the new Chief Operating Officer - Strategic focus has been refined to prioritize the development of the AAV cardiovascular gene therapy platform, specifically RP-A501 (Danon disease), RP-A601 (PKP2-ACM), and RP-A701 (BAG3-DCM)[1] - An organizational restructuring is underway, expected to reduce headcount by approximately 30% and lower the 12-month cash burn by nearly 25%[1][8] - The company reported cash, cash equivalents, and investments of approximately $271.5 million, which is expected to fund operations into the second quarter of 2027[1][9] - Chris Stevens has been appointed as the new Chief Operating Officer[1][6] CEO's Statement The CEO, Gaurav Shah, M.D., highlighted the second quarter of 2025 as an inflection point where the company sharpened its focus on its high-value AAV cardiovascular platform. He noted that this strategic shift, which includes pausing investments in the Fanconi Anemia (FA) and Pyruvate Kinase Deficiency (PKD) programs, strengthens the company's financial foundation and positions it as a leader in gene therapies for inherited cardiomyopathies - The company is fortifying its path to sustained value creation by focusing on programs with the highest value, conserving cash, and driving an efficient organization[3] - Rocket is pausing additional investments in its Fanconi Anemia (FA; RP-L102) and Pyruvate Kinase Deficiency (PKD; RP-L301) programs and is exploring strategic alternatives to advance them externally[3][8] - The CEO expressed confidence that the recent reorganization ensures the company is appropriately resourced to execute on near-term milestones with nearly two years of capital[3] Recent Progress and Updates Pipeline Updates The company provided key updates on its clinical pipeline. The Phase 2 study for RP-A501 (Danon disease) was placed on clinical hold by the FDA following a serious adverse event. In contrast, RP-A601 (PKP2-ACM) and RP-A701 (BAG3-DCM) received positive regulatory designations (RMAT and Fast Track, respectively), advancing them toward pivotal trials and clinical entry. The FDA review for KRESLADI™ (LAD-I) is ongoing, with a BLA submission expected by year-end 2025 RP-A501 (Danon Disease) The Phase 2 pivotal study for RP-A501 was placed on clinical hold by the FDA following a patient death, prompting a root cause analysis - The Phase 2 pivotal study for RP-A501 is on clinical hold by the FDA as of May 23, 2025, following a Serious Adverse Event (SAE) that unfortunately led to a patient's death[4] - A root cause analysis is underway, focusing on the recent addition of a C3 inhibitor to the pre-treatment regimen[4] RP-A601 (PKP2-ACM) RP-A601 received FDA Regenerative Medicine Advanced Therapy (RMAT) designation, with the company engaging the FDA on a potential pivotal trial design following encouraging Phase 1 data - Received FDA Regenerative Medicine Advanced Therapy (RMAT) designation in July 2025[1][4] - Following encouraging initial Phase 1 data presented at ASGCT, Rocket is actively engaging with the FDA on a potential pivotal trial design[1][4] RP-A701 (BAG3-DCM) The IND application for RP-A701 was cleared by the FDA, and the program received Fast Track designation, with Phase 1 trial start-up activities now underway - The Investigational New Drug (IND) application was cleared by the FDA in June 2025[4] - RP-A701 was granted FDA Fast Track designation, and Phase 1 trial start-up activities are now underway[1][4] KRESLADI™ (LAD-I) The FDA is reviewing additional CMC information for KRESLADI™, with the company expecting to submit the complete BLA to resolve the Complete Response Letter by year-end 2025 - The FDA is conducting a review of limited additional Chemistry Manufacturing and Controls (CMC) information for KRESLADI™[4] - The company anticipates submitting the complete Biologics License Application (BLA) to resolve the Complete Response Letter before the end of 2025[4] Corporate and Operational Updates Rocket has executed a strategic corporate restructuring, reducing its workforce by approximately 30% to align with its prioritized focus on the AAV cardiovascular platform. This move is expected to cut operating expenses by nearly 25% over the next year. As part of this realignment, the company has paused further investment in its Fanconi Anemia and Pyruvate Kinase Deficiency programs. Additionally, Chris Stevens was appointed as the new Chief Operating Officer - Implemented a workforce reduction of approximately 30% across all functions to align with the pipeline prioritization plan[8] - The restructuring and other cost-saving measures are expected to reduce operating expenses by nearly 25% over the next 12 months[8] - As part of the realignment, the company is pausing additional investments in its Fanconi Anemia (FA) and Pyruvate Kinase Deficiency (PKD) programs[8] - Appointed Chris Stevens, a seasoned executive with 25 years of experience from Spark Therapeutics, as Chief Operating Officer[6] Second Quarter 2025 Financial Results Key Financial Metrics For the second quarter of 2025, Rocket Pharmaceuticals reported a net loss of $68.9 million, or $0.62 per share, a slight improvement from the $69.6 million net loss in Q2 2024. The company reduced both R&D and G&A expenses year-over-year and ended the quarter with a solid cash position of $271.5 million Key Financial Metrics (in millions) | Financial Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Cash, Cash Equivalents & Investments | $271.5M | N/A | - | | R&D Expenses | $42.7M | $46.3M | ($3.6M) | | G&A Expenses | $25.0M | $27.4M | ($2.4M) | | Net Loss | ($68.9M) | ($69.6M) | $0.7M | | Net Loss Per Share | ($0.62) | ($0.74) | $0.12 | - The decrease in R&D expenses was primarily driven by lower costs for manufacturing, direct materials, and professional fees[9] - The decrease in G&A expenses was mainly due to reduced commercial preparation and compensation-related expenses[15] Restructuring Expenses and Financial Guidance The company incurred approximately $3.5 million in restructuring and related charges during the first half of 2025. Management expects its current cash, cash equivalents, and investments of $271.5 million will be sufficient to fund operations into the second quarter of 2027 - Approximately $3.5 million in restructuring and related charges were incurred in the first half of 2025[10] - The company's cash runway is expected to extend into the second quarter of 2027, excluding any potential proceeds from a Priority Review Voucher[9] Consolidated Financial Statements The consolidated statements of operations detail the company's financial performance for the three and six months ending June 30, 2025, showing a reduction in total operating expenses compared to the prior year. The balance sheet reflects total assets of $421.0 million and total stockholders' equity of $354.2 million as of June 30, 2025 Consolidated Statements of Operations (in thousands) | Statement of Operations | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Research and development | $42,658 | $46,345 | | General and administrative | $25,020 | $27,367 | | Restructuring | $3,471 | $0 | | Total operating expenses | $71,149 | $73,712 | | Loss from operations | ($71,149) | ($73,712) | | Net loss | ($68,919) | ($69,646) | | Net loss per share | ($0.62) | ($0.74) | Consolidated Balance Sheets (in thousands) | Balance Sheet | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash, cash equivalents, and investments | $271,494 | $372,336 | | Total assets | $420,979 | $527,700 | | Total liabilities | $66,768 | $64,466 | | Total stockholders' equity | $354,211 | $463,234 | Corporate Information About Rocket Pharmaceuticals, Inc. Rocket Pharmaceuticals is a late-stage biotechnology company developing a pipeline of genetic therapies for rare and complex disorders. The company utilizes a multi-platform approach, with an adeno-associated viral (AAV) vector-based portfolio for cardiovascular diseases and a lentiviral (LV) vector-based portfolio for hematology disorders - The company's AAV cardiovascular portfolio includes late-stage programs for Danon Disease and early-stage programs for PKP2-arrhythmogenic cardiomyopathy and BAG3-associated dilated cardiomyopathy[12] - The LV hematology portfolio consists of late-stage programs for Leukocyte Adhesion Deficiency-I (LAD-I), Fanconi Anemia (FA), and Pyruvate Kinase Deficiency (PKD)[13] Forward-Looking Statements This section serves as a cautionary notice to investors, stating that the press release contains forward-looking statements that are subject to significant risks and uncertainties. These statements, which are not guarantees of future performance, pertain to the company's plans, clinical trial timings, regulatory outcomes, and financial projections. Readers are advised not to place undue reliance on them - The press release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995[16] - These statements involve risks and uncertainties that could cause actual results to differ materially from expectations, including the ability to realize benefits from restructuring, trial outcomes, and regulatory decisions[16]